A Hedger Buys a Futures Contract That Obligates the Owner

question 99

Multiple Choice

A hedger buys a futures contract that obligates the owner to take delivery of 5,000 bushels of wheat at a price of $6.75 per bushel. At expiration the spot price of wheat is $6.80 per bushel. The hedger has:

• A) saved $0.05 per bushel through hedging.
• B) gained peace of mind at a price of $0.05 per bushel.
• C) the opportunity to avoid taking delivery since the price increased.
• D)locked in an effective price of $6.80 per bushel.

Recognize the impact of social inequality on deviance as explained by conflict theory.

Understand the significance of symbolic interaction in the concept of deviance.

Explain the process and implications of labeling in deviance.

Gain insight into the use of phenomenology and ethnography in studying deviance.

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Definitions:

Running Out Of Inventory

A situation where a business depletes its stock of products, potentially leading to missed sales opportunities and customer dissatisfaction.

Materials Requirement Planning

A production planning, scheduling, and inventory control system used to manage manufacturing processes.

Just-In-Time Inventory

An inventory management strategy that aligns raw-material orders with production schedules to minimize inventory costs and reduce waste.

Vendor-Managed Inventory

A supply chain management strategy where the supplier is responsible for maintaining the inventory levels at the buyer's premises.